Partnerships 'could boost biotechnology in Chile'

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[SANTIAGO] Chilean researchers have warned that the country's biotechnology industry is unlikely to grow under current conditions, and have called for creation of a "overarching body" to bring together stakeholders from government, research institutions and the private sector.

Writing in the August 2004 edition of the Electronic Journal of Biotechnology, the researchers propose two models for such a body. Each would help Chile's biotechnology industry overcome current constraints through public-private partnerships that would promote biotechnology-based business opportunities in the most active areas of the country's economy. This, say the researchers, would consolidate the sector and allow its guided expansion.

"We need to maximise available resources to strengthen the Chilean industries that have competitive advantages in the world — such as mining and aquaculture — with biotechnological tools and processes," lead author Cristian Hernandez-Cuevas, of the UK-based Cambridge MIT Institute, told SciDev.Net.

The paper's co-author is Pablo Valenzuela, a pioneer of biotechnology in Latin America who worked on the development of a vaccine against hepatitis B.

In their article, Hernandez-Cuevas and Valenzuela analyse the current status of biotechnology in Chile. Among other limitations, they say it lacks financial support from venture capital and foreign investors, has few highly qualified employees working in research and development (R&D), and produces few patents.

These constraints could be addressed by adopting one of two strategies based on public-private partnerships, called the 'business enhancer' and the 'consortium', say the researchers.

The business enhancer would be a new kind of organisation operating in two main ways. It would promote the creation of new companies by identifying business opportunities based on biotechnology products and solutions already on the international market. It would also improve the turnover of existing biotechnology businesses by promoting investment.

Hernandez-Cuevas and Valenzuela envisage the business enhancer having five strategic units, one for each competitive sector of the economy – mining, aquaculture, forestry, wine and fruit. Each unit would consist of a group of analysts, scientists and entrepreneurs assessing the business potential of biotechnology products. While outside companies would be responsible for adapting and developing specific biotechnology solutions, the business enhancer would pay for the licences needed to use the new technologies in Chile.

In contrast, the 'consortium' strategy would promote development of completely new biotechnology based products and services by reducing financial risks for private companies taking part in this process. This is important, say Hernandez-Cuevas and Valenzuela, as only one 'blockbuster' is developed for every thousand R&D projects undertaken.

The researchers propose that the Ministry of Economy, in collaboration with industry leaders and technical experts, decides which of Chile's industries would benefit most from biotechnology applications. Seed capital, coming mostly from the government initially, but later complemented by funds from the private sector, could then be distributed to each selected area.

While business enhancer would satisfy the needs of particular companies, the consortium approach would help solve large-scale problems of global industries such as mining, aquaculture, forestry and agriculture, say the researchers.

"The idea of this proposition is to position Chilean biotechnology under the umbrella of successful industries, similarly to what happened in the United States with health-related biotechnology organisations that initially served pharmaceutical companies," the authors explain.

The business enhancer would cost US$1,750,000 for five years of operations, while the consortium strategy would need US$5,000,000 for the same period, with most operations outsourced to other organisations.

Claudio Wernli, executive director of the Ministry of Planning and Cooperation's 'millennium scientific initiative', which promotes research and innovation, agrees that greater public-private integration is needed. "We need stronger links with the private sector, to develop joint programmes," he says.